ACCA Applied Knowledge · Business and Technology · Sustainable business practices
A manufacturer wants to assess the total greenhouse gas emissions released across its whole product life, from raw material extraction through to customer disposal. Which technique is most appropriate?
Life cycle assessment is the appropriate technique because it measures environmental impacts, including greenhouse gas emissions, at every stage of a product's life from raw material extraction to final disposal, rather than only within the factory.
- ALife cycle assessmentCorrect
- BVariance analysis
- CBenchmarking against competitors' profit margins
- DEnvironmental management accounting of overheads only
Explanation
Life cycle assessment evaluates the environmental impact of a product at every stage, from raw materials to disposal. Variance analysis compares actual and standard costs. Benchmarking profit margins is financial. Looking at overheads only would not capture upstream and downstream emissions.
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